Have to sell my property prematurely – do tenants deserve compensation?

by Readers Question

9:14 AM, 27th June 2016
About 2 years ago

Have to sell my property prematurely – do tenants deserve compensation?

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Have to sell my property prematurely – do tenants deserve compensation?

In June 2014 I bought a property as a retirement investment in Cornwall. It is in a lovely spot just 8-10 minutes walk from the coast. My tenants signed a contract in December 2014 and eventually moved in after the New Year of 2015. compensation

I now have to sell the property due to unexpected circumstances. I have told the tenants my situation and they have emailed to say they want compensation as they say they have spent thousands making it their home including carrying out improvements to the garden.

They also claim they have made the property considerably more valuable than when they originally moved in. The property had just had a complete facelift with a really nice new open-plan kitchen diner and new bathroom, redecorated throughout, new carpets etc, Apart from adding their own soft furnishings there wasn’t anything else left to do – as the inventory records will show.

At no time did they ask permission to make any improvements. Despite spending hundreds of pounds getting the garden cleared and tidied prior to them moving in they then stripped out lots more in the Spring and asked if I would contribute towards the cost of garden waste disposal. I gave them £100 which was more than half the bill. They decided to lift the shingle to the front of the house and replace the weed matting. Again, this was done without discussion or asking for any contribution towards labour. They now want compensation.

They also say I gave them a verbal agreement of a minimum of 10 years at the property and that apparently my 79 yr old mother said to them they could stay for 15 years (!) both of which is untrue. I had plans to retire there within 7-8 years.

Any suggestions on how I should handle this? My agent is issuing them the Section 21 and I am a member of NLA.

Many thanks

Jane



Comments

Neil Patterson

9:17 AM, 27th June 2016
About 2 years ago

Hi Jane,

From what you have said I don't see any legal requirement for you to pay compensation.

However, the situation changes a little if you want the tenant's help to sell the property as you may wish to be a touch more conciliatory if you are not looking for them to move out before you put it on the market.

Luke P

12:39 PM, 27th June 2016
About 2 years ago

Cheeky bleeders. Legally they are entitled to nothing. I would offer them something in order that they keep the place nice until the sale. If tenants want the surety of residency, do not rent.

Mandy Thomson

14:11 PM, 27th June 2016
About 2 years ago

Legally they are not entitled to anything, as you didn't contract with them for this (e.g. a deed of assurance). However, I think it's only fair that they get something, because they will have the expense and hassle of moving, when they didn't want to. The way they are behaving, however, is not good, and I wouldn't be surprised if they put all sorts obstacles in the way of your sale.

Perhaps you could try selling with the tenants in situ, though this will obviously restrict your market to other landlords.

15:21 PM, 27th June 2016
About 2 years ago

Reply to the comment left by "Neil Patterson" at "27/06/2016 - 09:17":

Hi Neil, Good to hear I am not legally obliged but I have a heart and am prepared to give them something but do not know how much to offer. Any ideas?

16:05 PM, 27th June 2016
About 2 years ago

Reply to the comment left by "Luke P" at "27/06/2016 - 12:39":

Hi Luke,

Despite having a heart and wanting to do the decent thing, I do however feel they are starting to swing the lead a bit too much now. I have bent over backwards for them over the past 18 months. And naively or not I thought I was doing the right thing by letting them know that my circumstances had changed but that I was doing my best to avoid selling the property if at all possible as it was on my bucket list to end up there in a few years time and I really did not want to sell it. Comparable properties to rent in the area are scarce so I thought I would give them the heads up to prepared for the worst and give them the chance to start looking. Yep I'm a rubbish poker player too!

Last Friday they decided not to pay their rent quarterly as agreed in writing and paid only 1 month without any consultation with me or the agent. This is the second time they have done this. The last time was on March 24th during a water leak which ruined the kitchen floor and for which they got 2 month's free rent (£1500 thank you very much - I couldn't claim it back thru loss of rent insurance as they said they couldn't find temp housing to take their 2 dogs and stayed put). Their reason at the time for rescinding on our agreement was they thought they were only paying in advance for the first 6 month period then going on to monthly which was rubbish. The agent rang them on Friday to find out why they had not paid the full 3 months again and they basically said they did not want to pay quarterly and that was that.

They didn't help themselves by doing this as I went from trying my best to keep them in the property to deciding it wasn't worth the hassle if they weren't going to respect our written agreement for rent guarantee. So I put in my 2 month's notice on Friday afternoon instead of enduring more sleepless nights trying to keep their tenancy in place. And now here I am with tenants who appear to be rolling up their sleeves for a fight.

I seriously don't want or need this to go pear-shaped so have to ensure the agent does everything to the letter in order to get them out. Fingers crossed it goes to plan.

Thanks for listening!

16:19 PM, 27th June 2016
About 2 years ago

Reply to the comment left by "Mandy Thomson" at "27/06/2016 - 14:11":

Hi Mandy,

I have thought to wait until they are out before putting it on the market firstly so I don't have to rely on their co-operation and compensate them for the disturbance caused by the estate agents etc. Secondly because I might need to make good if they decide to leave the property in a bad state for any reason and thirdly because I have had feedback from the various workmen who have been in the property recently dealing with the water leak repairs that the male tenant has a drink problem. Don't want the estate agent to have to deal with that when taking people round to view.

I am waiting for a call back from the NLA to find out how I get them out in the minimum amount of time possible and what I need to do to ensure the process happens without a glitch.

It doesn't help that my mortgage has just expired and gone on to the expensive roll-over monthly rate until I either renew or pay-up. Time is of the essence now.

Regards Jane

Charlotte Walker

7:59 AM, 29th June 2016
About 2 years ago

What a tricky situation. Stick to your legal obligations, once you start talking about compensating them you accept blame. They saw that you were a soft touch during your flood and will not stop until you give firm resistance. It's just human nature! Let your agent deal with the eviction and don't worry yourself about the details. Delay your sale until they have gone as they will only increase demands in order for you to get cooperation. They will never give a good viewing if they have developed an affection for the property.

8:25 AM, 29th June 2016
About 2 years ago

Reply to the comment left by "Charlotte Walker" at "29/06/2016 - 07:59":

Hi Charlotte, thank you for pointing out about not to start talking about compensation. I guess it needs to be referred to as a goodwill gesture if I decide to meet some of their moving costs. And point taken about their affection for the property which I know for sure they have.

I am going to confirm that the agents have everything in place before the Section 21 is issued as I lost confidence in them recently over a Gas SC issue. I need to establish whether a copy of the DPS certificate should have been sent to the tenant by the agent or whether it gets sent by the DPS to the tenants and that is sufficient. At the moment I have been sent a screen shot of the certificate from the agent but no proof that the tenants received a copy.

It's a great learning curve this!

John Pettman

13:52 PM, 2nd July 2016
About 2 years ago

Firstly you say your tenants signed a contract in Dec 2014 . The crucial question is for what period was the tenancy granted ???? 6 months a year or two years????? Secondly you could of course sell the property subject to the tenancy you do not have to sell with vacant possession although that would reduce the number of potential buyers. Assuming that the initial term has expired and that there is nothing in your original tenancy to the contrary you can just go ahead with issuing say the section 21 notice. If a defence is filed arguing that the tenant says that they were assured they could stay longer that is a matter that will be argued before the district judge. Does the tenant have any evidence to support that argument????

Michael Barnes

14:26 PM, 2nd July 2016
About 2 years ago

Reply to the comment left by "Jane Dunlin" at "27/06/2016 - 16:05":

If rent is due quarterly, then I believe that more than 2 month's notice is required.

A quick web search suggests minimum 3 months, but you should seek professional guidance.

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